IRA victims could secure around £3m each if Libya agrees to a massive compensation deal for supplying republicans with weapons during the Troubles.

Some victims are pledging to use the money to pursue civil actions against alleged IRA members whom they believe were involved in the murder of their loved ones.

They said they would launch legal actions, similar to the Omagh bomb case, against people allegedly responsible, but never convicted, for shootings and bombings.

A political delegation supporting the Libyan compensation campaign arrived in Tripoli yesterday. It includes DUP MPs Jeffrey Donaldson and Nigel Dodds, Ulster Unionist peer Lord Bew, British Labour MP Andrew MacKinlay and Lord Brennan QC.

They are holding talks with Libya's Europe minister, Abdelati al-Obidi, and members of the Libyan Congress and the Gadaffi Foundation. Jeffrey Donaldson said: "This is a significant step forward. I hope the matter will be settled before the end of the year but it might take a little longer."

A £500m deal was thought possible but campaigners now believe it could be larger. Willie Frazer of IRA victims' group FAIR said: "It could be £1bn. Colonel Gadaffi is an unpredictable man and nothing is confirmed, but the situation looks very promising.

"The 176 victims whose names are on the class action could receive around £3m each. Money won't bring back their relatives, or compensate for horrific injuries, but such a package would hold Libya accountable for its actions and help bring closure for victims."

Manya Dickinson and Ashley Graham whose father Kenny Graham – a Co Down building contractor who supplied the security forces – was killed by the IRA in 1990, are among those in the class action.

Dickinson said: "The bomb which killed my father contained Libyan Semtex. I was 13 and my sister was 10 when daddy died. Our family suffered financially. As well as improving our lives, we will use any compensation to issue writs against those involved in daddy's murder.

"We know who they are but the police never arrested them. Until now, we haven't had the money to take a civil action. Make no mistake – we will pursue these people."

The financial package, plus the likelihood of civil actions, will infuriate many Sinn Féin supporters. It comes on the back of a £20m British government payment plan for former part-time police reservists and £6.7m compensation for ex-Royal Irish Regiment soldiers.

The first part of any Libyan money will go to the 176 people in the class action. The second part will go to the hundreds of IRA victims now requesting that their names be added. They will likely receive smaller payments.

The third part of the package would be used to promote reconciliation. Victims of loyalist and state violence could apply for funds in this section. An IRA victims' delegation is expected to visit Libya later this year. It will include those injured in attacks in Britain such as Canary Wharf.